Royal Legislative Decree 1/2020, of 5 May, which approves the Recast Spanish Insolvency Law (Texto Refundido de la Ley Concursal, or TRLC) entered into effect on 1 September. As a result, the former Insolvency Law 22/2003, of 9 July, has been derogated almost in its entirety.
According to the TRLC’s Preamble, Spanish insolvency legislation has been amended given the need to reorder, clarify and harmonise the former Insolvency Law and the provisions that have since amended it.
As such, the TRLC will apply to all insolvency proceedings, both those that started before it entered into force as well as those opened subsequently, with the exceptions expressly provided for in the TRLC’s derogatory and transitional provisions.
According to the TRLC’s only transitional provision, the contents of articles 57 to 63, 84 to 89, 560 to 566 and 574.1, all included – pertaining to amendments made to articles 27 (conditions for appointing insolvency administrators), 34 (remuneration of the insolvency administrators) and 198 (Public Insolvency Register) of the former Insolvency Law – will not enter into effect until regulatory provisions have been enacted to implement them.
The new TRLC is divided into three books: the first on insolvency proceedings; the second on pre-insolvency; and the third on the provisions of private international law. The TRLC, has a total of 752 articles, almost three times as many as the former Insolvency Law, which had 242 articles and eight additional provisions.
Therefore, the most significant features of the new TRLC are that (i) it has a new wording, structure and numbering; and (ii) it contains recent case law and legal doctrine as interpreted by the Spanish Supreme Court.
It should be pointed out that the urgent measures that were passed due to the Covid-19 outbreak, especially those brought in by Royal Decree-Law 16/2020, of 28 April, of procedural and organisational measures to tackle COVID-19 connected to the administration of justice, have not been repealed by the TRLC; those provisions will therefore coexist for the time being.
Within the specific context governed by those provisions, and in application of the principle of speciality enjoyed by the exceptional measures that have been implemented, they will prevail over those established in TRLC until they cease to be in effect.